TODAY.AZ / Business

French Development Agency ready to provide financial support for renewables

24 May 2019 [13:45] - TODAY.AZ

By Azernews

By Leman Mammadova

Azerbaijan consistently holds negotiations with foreign companies and investors to implement major projects for the further development of alternative energy sector.

Ministry of Energy has held a meeting with Head of South Caucasus Department of French Development Agency Gaelle Assayag.

At the meeting, it was noted that the Agency has been involved in the financing of sustainable energy supply, clean energy projects along with transport, agriculture and other spheres. In addition, so far, the Agency has allocated 10.4 billion euros to 752 projects in various fields.

Assayag noted that the Agency is interested in participation in renewable energy sources and energy efficiency projects in Azerbaijan, stressing that it is ready to provide financial support.

In turn, Elnur Soltanov, Deputy Energy Minister of Azerbaijan, briefed on Azerbaijan's wind, solar and other renewable energy potential and informed about the work done to develop this sphere.

He noted that currently the normative legal base is being created for attracting private investments in the development of the renewable energy sector, and mechanisms for the application of preferential tariffs are being prepared.

In his words, cooperation documents were signed with BP, Total, Masdar and other foreign companies to expand use of renewable energy sources.

The sides exchanged views on perspective projects for renewable energy cooperation.

It should be noted that the French Development Agency started working in the South Caucasus in 2012 to promote "green and inclusive growth." Its engagements in the region include loans to the government, as well as businesses and local authorities. In addition, it mobilizes European grants under the Neighborhood Investment Facility - East.

The Agency provides support to Azerbaijan particularly in the fields of transport, the private sector, clean energy and sustainable tourism.

Presently, the Agency aims to diversify the country’s economy by assisting Azerbaijan in preparing for the post-oil era.

Energy cooperation between Azerbaijan and France covers oil and gas production, geological exploration, petrochemical industry.

French company Total has a 50 percent interest in the Absheron production sharing agreement in the Caspian Sea, and also holds a 5 percent share in the Baku-Tbilisi-Ceyhan (BTC) oil pipeline.

Total sells gas to SOCAR, Azerbaijan's national oil company, and markets petrochemicals, automotive and industrial lubricants in Azerbaijan, while buys crude oil, especially from SOCAR.

Recently, Azerbaijan and Total have signed a memorandum of understanding for the development of renewable. This envisages cooperation in assessment of potential and creation of conditions for investment in renewable energy projects in Azerbaijan.

Presently, Azerbaijan implements a number of measures for further development of alternative energy sector, aimed at reduction of its dependency on oil and gas. The favorable geographic location and climatic conditions allow the widespread use of environmentally friendly alternative energy sources in Azerbaijan.

According to the Market Analysis Azerbaijan 2019, expansion of renewable electricity generation is estimated at 430 MW in 2018-2020, 840 MW in 2021-2025, and 925 MW in 2026-2030. The share of renewables in the total power generation is expected to be 15 percent by 2020, 25-30 percent by 2025 and 35-40 percent by 2030.


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